Nepal hits Chinese transformer suppliers with $7.1 million fine

Nepal, Kathmandu: The Special Court of Nepal issued a verdict instructing the government to slap a fine of $7.1 million on various Chinese companies which had supplied substandard transformers to Nepal Electricity Authority (NEA), bringing a closure to the multi-million rupee transformer procurement fraud.

The related cases were filed by the Commission for the Investigation of Abuse of Authority (CIAA) about three years ago, reports The Himalayan Times.

The authority had alleged that the scam took place in collaboration with NEA officials and the manager of the company, who have also been fined and pronounced prison sentences.

In one of the biggest scams to be exposed in the country, CIAA had filed a case against 22 NEA officials and Chinese suppliers.

During the CIAA probe, it was revealed that the Chinese suppliers had used aluminum wires instead of copper wires and transformers supplied to NEA lacked proper security features.

These resulted in unstable transmission of electricity and transformerexplosions, which occurred in cases of even slight fluctuation in current flow.